Tension Builds at Trans Maldivian Airways Amid USD/MVR Salary Changes

Employees at Trans Maldivian Airways (TMA) are voicing growing concern over changes to their salary structure following the introduction of a new government mandated foreign currency regulation.

The seaplane operator has temporarily revised salary disbursement to an 80% US dollar and 20% Maldivian Rufiyaa (MVR) split for the next two months. Beyond that, no official communication has been made regarding long term arrangements, prompting fears of a shift toward higher or complete MVR based salary triggering rumors of a possible strike.

Background: Currency Law Reshapes Business Operations

The recent payroll changes are directly tied to the implementation of the Foreign Currency Act (32/2024), a law passed earlier this year aimed at increasing the Maldives’ foreign exchange reserves and stabilizing the local currency.

The regulation mandates that companies earning significant revenue in foreign currency must convert a portion of their earnings through the Maldives Monetary Authority (MMA).

Under the new law, tourism businesses are categorized based on their scale of operations. Category A tourism establishments are required to exchange either USD 500 per tourist arrival in a calendar month or 20% of their monthly gross foreign currency sales, whichever is greater.

Category B tourism establishments, such as smaller guesthouses and hotels, must exchange either USD 25 per tourist arrival or 20% of their monthly gross foreign currency sales.

Additionally, non-tourism businesses that earned a minimum of USD 15 million or equivalent in foreign currency in the previous calendar year are also required to convert 20% of their monthly gross foreign currency revenue.

Operational Impact at Trans Maldivian Airways

TMA, the world’s largest seaplane operator with over 60 aircraft and a key player in the country’s resort transfer network, is among the companies affected. The compulsory currency exchange has significantly limited its access to USD liquidity, especially for payroll. This has led to the introduction of the temporary 80/20 split in staff salaries.

Although the short term measure has been communicated, employees are seeking clarity on what will follow. Employees are also expressing concern over the loss of value when a portion of their income is converted at fluctuating exchange rates.

Employee Response

While no formal strike has been declared, the lack of assurance about future salary arrangements has raised tensions. Some staff forums are reportedly considering collective action if a long term resolution is not reached before the trial period ends.

Other aviation operators have already started implementing similar salary adjustments. For example, Manta Air recently shifted to a 50/50 USD/MVR salary split, signaling a broader trend that could ripple across the sector.

Economic Rationale and Broader Implications

From a macroeconomic standpoint, the new law is designed to strengthen MVR liquidity, reduce reliance on black market currency trading, and ensure that more foreign exchange passes through official banking channels. The government argues this will help stabilize the currency and support the domestic economy.

However, critics argue that the burden is being passed on to employees, especially those whose financial commitments are to the US dollar. The Tourism Employees Association has reported that workers could lose between MVR 3,000 to 5,000 per month due to conversion losses. This has led to mounting dissatisfaction in sectors where USD salaries were once the norm.

As of now, TMA has not issued an official statement on its long term payroll strategy, and government officials have refrained from addressing company-specific concerns. With uncertainty surrounding future salary structures and rising concerns among TMA’s workforce, the coming weeks will be critical. A breakdown in dialogue could lead to operational disruptions that affect not only the airline but the broader tourism industry across the Maldives.